Venezuela


#241

Malathor is gonna be like Vader and finally take off his mask and rejoin the light side after throwing Trump down into the station core.


#242

Heh. You know the problem isn’t that I don’t think Trump is a boorish, narcissistic, ego-driven, loathsome man, I do. The problem is that I think that of pretty much every politician.


#243

You know what we are seeing is different.


#244

It’s hard to read that list as an argument in favour of deregulation and minimal government. If anything the evidence seems to support that centrism is the path to consistent success.

As an argument against massive corruption and authoritarian rule it totally works though. Don’t let your country get taken over by kleptocrats.


#245

Except for Singapore. As Timex said before, Singapore is pretty much a disguised authoritarian regime and should never be discussed alongside democracies, and I can’t understand the hard-on conservatives have about it (I think it’s ok to discuss it alongside Venezuela though. Authoritarian capitalism does have a better track record than authoritarian socialism, maybe because is is less schizophrenic of a setup).


#246

Singapore’s a particularly amusing example given that state-owned Temasek owns controlling stakes in nearly all the largest companies in the country, almost all news media is state-controlled, and political films are banned. It’s neither laissez faire capitalist nor free.


#247

It almost seems like it’s a bit too late for that here in the US.


#248

Malathor is right on one thing, though; if your metric is “most money in the pockets of the most rich,” laissez faire works really well. Sucks for everyone else, though.

Adam Smith based his market theories on a bedrock of social consciousness, albeit 18th century style filtered through the eyes of an uppercrust Scotsman. John Stuart Mill, one of the great defenders of liberty and capitalism, savaged contemporary laissez faire attitudes of the 19th century, and flat out said that socialism at its best was better than capitalism at its worst, though the latter was far superior when done correctly. Pretty much everyone other than Ayn Rand-types who supports a market system has understood the need for regulation and guidance of some sort. Ideas like capitalism–or socialism, for that matter-- are not simply economic systems. They are total social, cultural, and political frameworks, with far-reaching consequences. Smith was really a philosopher, not a modern economist.


#249

But it generally sucks much LESS for everyone than a socialist state like venezuela. That’s an important point.

While a freely capitalist society may result in wealth inequality, it also tends to result in an improved standard of living for everyone… while socialism in an authoritarian regime tends to lead to the same kind of inequality (with the “rich” simply being those with government connections through corruption), but due to the inherent inefficiencies of the economy, everyone suffers.

Venezuela demonstrates exactly how this plays out… they have tons of natural resources, but the nation is basically fucked over.


#250

This has only been true for a limited sub-set of times and places, and largely due to historically anomalous factors, IMO. The “magic economy” of post-WWII, in the USA, did this, to some extent. Before that, wealth was not distributed terribly equally, and in the first seventy or so years of the republic, the relatively wide distribution of wealth was, one, limited to white people and men, and two, was based on slavery. Since WWII, I’d argue the most successful societies, in terms of widely distributed gains in standard of living, have been those that approached the economy with a balanced approach, capitalism guided by social responsibility and regulation.

There is no doubt capitalism is the finest pure wealth generator there is; even Marx said so. The question is how that wealth is distributed. Untrammeled capitalism for the few only generates success for the many when a lot of very unlikely things coincide. Left to its own, the only guarantee is that the rich get richer. You can make it work, though, by channeling it via democratic governments. That’s not socialism at all, it’s responsible capitalism.

Venezuela is an example of pure irresponsibility, criminality, and egregious dereliction of duty. It’s hardly an example of any sort of coherent economic policy IMO.


#251

It’s been the case for every time and place, as far as I’m aware.

In every authoritarian socialist regime, you’ve seen widespread suffering for the people living under it. Every single one, I think.

But ultimately, the distribution of wealth is less important than whether everyone sees improvement.

Unequal wealth distribution where everyone benefits is preferable to a situation where everyone fails to see improvement equally.

And that ignores the fact that, as I said previously, the notion that authoritarian socialist regimes distribute wealth equally if obviously full of shit anyway. In regimes like Cuba, or Venezuela, or the USSR, party leaders just took the place of captains of industry. They lived like kings, while the masses suffered.


#252

No duh; that’s not what we’re debating, though. What we’re debating is the idea that unequal wealth distribution usually or even often leads to wide-spread benefit. That’s the theory of market capitalism, but my argument is, it is not the usual result. I’d argue that while such a system may well be preferable to many other options, it generally only results in widespread benefit either because circumstances are unusual and not repeatable, or the society at large (i.e., government) nudges the system in certain directions and restrains it in others.

Saying that distribution is not important as long as people overall improve is something I understand, but disagree with. Ultimately, in my view, enough inequity leads to problems. You have to not only have wide spread benefit but also limit the gap between the top and the middle (the bottom is, well, the bottom) because if you don’t, inevitably the ones with the most wealth seek the most power and screw everyone else.


#253

To be clear, the statement I made is that distribution was LESS important than overall improvement. That is, a situation where everyone improves, albeit unequally, is preferable to one where no one improves. Which seems logically obvious to me.

But in that case you’re not seeing everyone improve, so it’s not what we’re talking about.


#254

Ok, sure. But my observation is really that, in most cases, this is exactly what happens, and any wide spread improvement is purely accidental, and often unsustainable over time. I prefer a system that harnesses the power of capitalism and directs it rather than letting shit happen as it may.


#255

While I agree that some government direction can be useful if done with a light touch, you need to recognize that one of the reasons why capitalism is efficient at producing wealth is exactly because it just lets shit happen as it may.

It problem with central planning, is that individuals in government are less competent than markets when it comes to directing resources.


#256

A nice example from a book review on the Soviet economy

A tire factory had been assigned a tire-making machine that could make 100,000 tires a year, but the government had gotten confused and assigned them a production quota of 150,000 tires a year. The factory leaders were stuck, because if they tried to correct the government they would look like they were challenging their superiors and get in trouble, but if they failed to meet the impossible quota, they would all get demoted and their careers would come to an end. They learned that the tire-making-machine-making company had recently invented a new model that really could make 150,000 tires a year. In the spirit of Chen Sheng, they decided that since the penalty for missing their quota was something terrible and the penalty for sabotage was also something terrible, they might as well take their chances and destroy their own machinery in the hopes the government sent them the new improved machine as a replacement. To their delight, the government believed their story about an “accident” and allotted them a new tire-making machine. However, the tire-making-machine-making company had decided to cancel production of their new model. You see, the new model, although more powerful, weighed less than the old machine, and the government was measuring their production by kilogram of machine. So it was easier for them to just continue making the old less powerful machine. The tire factory was allocated another machine that could only make 100,000 tires a year and was back in the same quandary they’d started with.


#257

Central planning, yes; that’s a pretty terrible system. Just letting shit happen, though, won’t cut it either. Or, rather, you let it happen in things like determining what businesses make, and how consumers choose, but you don’t let desire for profit gut your healthcare system, infrastructure, or social services.

I worked in the Cold War military industrial complex, and went to grad school to take courses in stuff like Soviet government and policy. I’m pretty well aware of how awful those bozos were. But I’ve lived for over a half-century in our capitalist society, and I’m also pretty well aware of how flawed our system is. Better than some bastardized socialist so-called Utopia? Of course. But I don’t think anyone can look at the current socio-economic situation and declare it good and just.


#258

Yeah there is a lot of waste even in a well-functioning market, and a lot of markets are a long way from well-functioning. You get monopolies, oligopolies, information asymmetry, externalities, principal-agent problem, regulatory capture. That’s leaving question of distribution of outputs. Frankly it’s amazing things work at all.


#259

It’s not like we don’t know what works, we’ve known what works for quite some time now. Sure, new stuff comes along and we need to adjust things, and people might disagree where the line is, but really, government isn’t exactly something new that we’re only now trying, is it?

Let people make money, tax them, redistribute that money towards worthy causes and making sure the population doesn’t take the redistribution part into their own hands (AKA killing the people with money). Hopefully apply a “don’t be evil” clause to each of these steps.

Sure, my bold idea of “keep doing what’s worked before, try and improve it a bit and make sure that the rich and powerful actually have skin in the game” is not exactly revolutionary, but historically revolutions have an iffy track record anyway…


#260

No, what you are suggesting is pretty much how it’s supposed to work “Skin in the game” was crucial to the founders’ vision of things. What happened over time, though, was that wealth got so powerful it elevated the elites to a position where they weren’t just players who had to respect the game, they were the game.